May 26, 2018

Do You Need or Should You Get Title Insurance?

In order to make an informed decision, here is some background information about title insurance.


‘Title’ is the legal term for ownership of property.  Buyers want “good and marketable” title to a property.  Marketable title means title the buyer can convey to someone else.  Prior to closing, public records are searched to determine the previous ownership and dealings of the property.  The search might reveal:  existing mortgages, liens for outstanding taxes, utility charges, etc., registered against the property.  At closing the buyer expects property that is free of such claims and should be cleared up before closing.

Sometimes problems (or defects) regarding title are not discovered before closing or are not remedied before closing.  Such defects can make the property less marketable when the buyer subsequently sells and depending on the nature of the problem, can also cost money to remedy.  For example, the survey might have failed to show that a dock and boathouse built on a river adjoining a vacation property was built without permission.  The buyer of the property could be out of pocket if he is later forced to remove the dock or boathouse.  Or the property might have been conveyed to a previous owner fraudulently, in which case there is the risk that the real owner may come forward at some point and demand their rights with respect to the property.

Title insurance policies can be issued in favour of a purchaser, a lender or both.  Title insurance protects purchasers and/or lenders against loss or damage sustained if a claim that is covered under the terms of the policy is made.

Types of risks that are covered include:  survey irregularities; forced removal of existing structures; claims due to fraud, forgery or duress; unregistered easements and rights of way; lack of pedestrian or vehicular access to the property; work orders; zoning and set back non-compliance or deficiencies; etc.

Title insurance remains in effect as long as the insured purchaser has title to the land.  Some policies also protect those received title as a result of the purchaser’s death (eg a spouse or children).  In the case of the lender’s coverage, the policy remains in effect as long as the mortgage remains on title.

The premium for title insurance is paid once at the time of purchase.  The cost for a typical residential home of less than $500,000 in Ontario is approx. $200 + taxes.

Colleen Saunders is a 20 year veteran in the mortgage industry, serving Mississauga, Burlington, Oakville and Toronto and offering all mortgage related services such as 2nd mortgages, private mortgages and more.

To contact Colleen, please fill out the form on our site or call 416-459-2406

Tips For Paying Off Your Mortgage Faster

Paying down extra principle by whatever means possible can shorten the life of your mortgage and dramatically lower the interest you will pay over the long haul.  Here are a few tips on how to make this happen:

1-  Increase your payment annually to the most you can afford –   most lenders will allow you to reduce your payment again if it turns out to be too great a burden or your circumstances change

2-  Utilize your RRSP driven tax rebate as a mortgage prepayment method – many Canadians borrow at prime rate to buy an RRSP to ensure maximum rebate.  Combining the refund with the tax-free interest earned on the RRSP over the subsequent years will quickly outpace the short-term interest costs of a RRSP loan

3-  Increase the frequency of your payments – make accelerated bi-weekly payments which is equivalent to one full mortgage payment every year and is relatively painless

4-  Round your payments up – even a nominal amount of say $10 per payment will save you thousands of dollars in interest

5-  Pay a lump sum whenever possible – most lenders allow you to prepay between 10-20% annually

6-  Keep payments the same when mortgage rates have fallen – If the payment amount has not been a problem so far, then keep it the same and it will pay down the principal faster

7-  Raise payments in line with increased income on an after-tax basis – although the disposable income may be fun to spend on unnecessary luxuries in the short term, the thought of being mortgage free far outweighs the short term sacrifice

Colleen Saunders is a 20 year veteran in the mortgage industry, serving Mississauga, Burlington, Oakville and Toronto and offering all mortgage related services such as 2nd mortgages, private mortgages and more.

To contact Colleen, please fill out the form on our site or call 416-459-2406

How To Prepare For Your Mortgage Renewal

In today’s marketplace, nearly 60% of people sign back their mortgage renewal letters without investigating other alternatives.  As a result, there are little or no incentives for the financial institutions to offer the best rates on renewal.  You will also notice that the institutions send out the renewal letters 2 – 3 weeks before your mortgage matures as this leaves you very little time to arrange financing with another lender or to take advantage of the lower rates that may have occurred in the 3 – 4 months before your renewal date.  Rest assured that the first offer is most definitely not their best offer and most renewal offers are at their posted rates.  
Consumers should be previewing their renewals 90-120 days prior to their actual renewal date.  This gives you the benefit of the lowest rate for a longer period of time prior to your renewal date.  

If you are doing a straight switch to the new institution, it is totally free and any costs that might be incurred are paid for by the new lending institution that you will be dealing with.  You get the best of both worlds, the best rate possible and it is totally free! If your current mortgage holder really wanted your business, wouldn’t they have given you their best rate right up front?  In today’s market, discounts of over 1% off the posted rates is not uncommon on renewals, even though your lender may tell you otherwise. Before your current mortgage holder sends you anything – shop the market.  

Colleen Saunders is a 20 year veteran in the mortgage industry, serving Mississauga, Burlington, Oakville and Toronto and offering all mortgage related services such as 2nd mortgages, private mortgages and more.

To contact Colleen, please fill out the form on our site or call 416-459-2406

Canadians Confident In The Investment Potential Of Recreational Properties

An overwhelming majority of Canadians who have either purchased or who intend to buy recreational property in the next 24 months believe that buying a vacation home is a good long-term investment.  This is according to a nationwide survey of Canadian attitudes towards recreational property ownership commissioned by Royal LePage Real Estate Services and run on the Angus Reid Forum.

Overall, the survey found that 89% of current owners and prospective buyers agree that recreational properties are a good long-term investment.  Broken down by region, this included 91% of Ontarians.

When respondents were asked to compare recreational properties to the stock market in terms of providing a larger financial return on investment, 50% said recreational properties provided a larger return.  Only 29% replied investing in the stock market while 21% were undecided.

“Canadians’ confidence in recreational property values is mirroring what we have been seeing in Canada’s urban centres,” said Phil Soper, president and chief executive, Royal LePage Real Estate Services.  “This spring, the horror stories from some fundamentally flawed international housing markets that had dampened demand for cottage-type living during the recession era, are being shrugged off.”

Interestingly, a majority of respondents (57%) said that the expectation of interest rates rising will not affect their desire to purchase a recreational property.

More than 51% of those polled said they are, or will be, renting out their property to offset their mortgage and other associated costs.  However, many of those willing to rent plan to be selective (32%) and only rent to someone that has been referred.   

“The purchase motivation for most is not financial planning.  It remains lifestyle driven, satisfying the needs and wants of their family” said Soper.  “In fact, 92% of those we polled agreed that a recreational property is a great way to bring family together.”

Colleen Saunders is a 20 year veteran in the mortgage industry, serving Mississauga, Burlington, Oakville and Toronto and offering all mortgage related services such as 2nd mortgages, private mortgages and more.

To contact Colleen, please fill out the form on our site or call 416-459-2406

The Importance of First-Time Buyers

Have you ever wondered how vital first-time buyers are to the real estate market.  According to The Altus Group’s ‘FIRM Residential Mortgage Survey’, first-time home buyers accounted for about half of all homes sold in Canada in the last 2 years.  That is more than a quarter million sales each year.


“First-time buyers make the home-sales world go around” states the report and they play “an important role as buyers in the newly built home market and also the existing homes market”  

First-time buyers are especially vital to lower-end property sales which are essential to a healthy market because it allows existing homeowners to sell efficiently and then upgrade.

Despite low interest rates, however, Altus Group says access to the market has become more restricted for entry-level buyers.  This is attributed to prevailing house-price levels and the impacts of more stringent mortgage insurance criteria.

Canadian Real Estate Association economist, Gregory Klump, suggests the new mortgage rules have had an immediate impact.  “Changes to mortgage regulations that took effect April 2011 have likely sideline a number of first-time homebuyers.”  Of all the government’s recent changes, the reduction in maximum amortization periods carries the biggest impact.  41% of home buyers in the last 16 months chose extended amortizations in excess of 25 years.

Some interesting findings:
  • Those aged 25 to 34 accounted for 6 of every 10 first-time buyers
  • About 1 in 4 first-timers were between 35 and 49 years old
  • Single person households made up roughly 1/4 of recent home purchases
  • The average price paid by first-time buyers was $273,000 or about 4 times the average annual household income of $69,000.

Colleen Saunders is a 20 year veteran in the mortgage industry, serving Mississauga, Burlington, Oakville and Toronto and offering all mortgage related services such as 2nd mortgages, private mortgages and more.

To contact Colleen, please fill out the form on our site or call 416-459-2406